Businessweek Archives

Marketers Know Too Much About Us

September 04, 1994

Editorials

MARKETERS KNOW TOO MUCH ABOUT US

The invasion of privacy is proceeding at an alarming rate, with supercomputers recording and compiling every transaction in a person's life. These records of Americans' income, spending habits, and preferences are putting a growing amount of power into the hands of a few government bureaucrats and private marketers (page 60).

Are the data gatherers adequately policing themselves? The government, to begin with, is actively selling huge amounts of personal information to listmakers. Is it right for state motor-vehicle bureaus to sell the names and addresses of individuals who get driver's licenses? Is it proper for institutions such as hospitals to sell the names and addresses of women who just gave birth on their premises? Just how much financial information should credit agencies be permitted to sell?

It's not that database marketing hasn't any value. Clearly, it does. Customized billing can provide important information and opportunities to the consumer. Credit-card companies can offer discounts on specific restaurants for people who eat out a lot, and telephone companies can give people breaks on phone calls to countries where they have parents or brothers and sisters.

But what are the limits, and how do the rights of individuals get protected? It is increasingly easy for powerful computers to mix and match profile traits of individuals, reach erroneous conclusions, and mistakenly put consumers on the wrong list. Once they are on that list, it is certain their names will appear on dozens of others, targeting them for goods and services that may prove annoying, embarrassing, or even threatening to themselves or their families.

Congress can help by passing legislation that tells government agencies, hospitals, and any quasipublic institution to simply stop selling data about people unless individuals specifically permit it in writing. Who gave government agencies the right to cash in on information that people are forced to give them in the first place?

The direct-marketing industry can help by lifting its own standards. It currently relies largely on the "opt-out" provision to protect individual rights. This is the clause that sometimes appears at the bottom of documents that says "check here" if a person does not want his or her name passed on. Fair enough, except that the print is invariably small, and the provision, when it appears, is usually buried far out of the way.

The Direct Marketing Assn. should insist that its members give people a real choice by making the opt-out clause clear and prominently displayed at the top of all private documents. The DMA maintains that consumers who want to get their names off mailing lists merely have to phone them. Fine. Here's the number: 202 347-1222. Too bad it's not toll free.